Aggregate Bond Index vs. Stock Index 1980-2021

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Finding the year-by-year total returns for the major indices can be a challenging task, so investors should find the following table useful. The left column shows the return of the Bloomberg U.S. Aggregate Bond Index—also known as the Agg.

The index measures the performance of investment-grade bonds in the United States and includes U.S Treasuries; government-related issues; corporate bonds; agency mortgage-backed pass-throughs; consumer asset-backed securities; and commercial mortgage-backed securities.

In the middle column, the S&P 500 Index measures the performance of the 500 largest companies in the U.S. stock market. On the right is the difference in performance between the two.

Find out more about how stocks and bonds stack up on a long-term basis.

Key Takeaways

  • Bonds outperformed stocks on these two indices for 11 out of 42 years.
  • Stock outperformed stocks in more years and had better overall returns.
  • $100 invested in stocks (S&P 500) in 1928 grew to about $761,710 by the end of 2021, while $100 in T-bills and T-bonds grew to about $2,083 and $8,526, respectively.

Returns on Bloomberg US Aggregate Bond Index vs. S&P 500

The table below shows the return of the two indices on a year-by-year basis between 1980-2021. Information is gathered from multiple sources.

Bloomberg Agg.  S&P 500 Difference
1980 2.71% 31.74% 29.03%
1981 6.25% -4.70% 10.95%
1982 32.62% 20.42% 12.20%
1983 8.35% 22.34% 13.99%
1984 15.15% 6.15% 9.00%
1985 22.10% 31.24% 9.14%
1986 15.26% 18.49% 3.23%
1987 2.76% 5.81% 3.05%
1988 7.89% 16.54% 8.65%
1989 14.53% 31.48% 16.95%
1990 8.96% -3.06% 12.02%
1991 16.00% 30.23% 14.23%
1992 7.40% 7.49% 0.09%
1993 9.75% 9.97% 0.22%
1994 -2.92% 1.33% 4.25%
1995 18.46% 37.20% 18.74%
1996 3.64% 22.68% 19.04%
1997 9.64% 33.10% 23.46%
1998 8.70% 28.34% 19.64%
1999 -0.82% 22.89% 23.71%
2000 11.63% -9.03% 20.66%
2001 8.43% -11.85% 20.28%
2002 10.23% -22.97% 33.20%
2003 3.63% 28.36% 24.73%
2004 4.10% 10.74% 6.64%
2005 2.06% 4.83% 2.77%
2006 4.12% 15.61% 11.49%
2007 6.97% 5.48% 1.49%
2008 5.24% -36.55% 41.79%
2009 5.93% 26.94% 21.01%
2010 6.54% 14.82% 8.28%
2011 7.84% 2.10% 5.74%
2012 4.21% 15.89% 11.68%
2013 -2.02% 32.15% 34.17%
2014 5.97% 13.52% 7.55%
2015 1.14% 1.38% 0.24%
2016 3.25% 11.77% 8.52%
2017 3.54% 21.61% 18.07%
2018 0.01% -4.23% 5.23%
2019 8.72% 31.21% 22.49%
2020 3.76% 18.02% 14.26%
2021 -1.5% 28.47% 29.97%

Bloomberg Aggregate Statistics

The Agg's performance:

  • Years Positive: 38 of 42
  • Highest Return: 32.65%, 1982
  • Largest Decline: -2.92%, 1994
  • Average Annual Gain (1980-2018): 7.41%

(Note: This is simply the average gain, not an average annualized total return.)

S&P 500 Statistics

The S&P 500's performance:

  • Years Positive: 35 of 42
  • Highest Return: 37.20%, 1995
  • Largest Decline: -36.55%, 2008
  • Average Annual Gain: 13.52%

Comparative Statistics

Some interesting statistics:

  • Years Bonds Outperformed: 11 of 42
  • Years Stocks Outperformed: 31 of 42
  • Bonds’ Largest Margin of Outperformance: 41.79%, 2008
  • Bonds’ Largest Margin of Underperformance: -34.17%, 2013

A 50-50 Split

How would a 50-50 allocation of $1,000 invested in 1928 between the two indices have fared?

  • Years Positive: Bloomberg 37 of 42, S&P 500 34 of 42
  • Highest Return: Bloomberg $1,461, S&P 500 $28,353
  • Largest Decline: Bloomberg -$299, S&P 500 -$10,850
  • Average Annual Gain: Bloomberg $581, S&P 500 $8,751

Figures From 1928-2021

The Federal Reserve Bank of St. Louis has measured the returns of stocks, Treasury bills, and 10-year Treasury bonds since 1928.

Some interesting figures from 1928-2021 are:

  • Stocks averaged an annual return of 11.82% in the period from 1928-2021, while T-bills and T-bonds averaged 3.33% and 5.11%, respectively.
  • $100 invested in stocks in 1928 would have grown to $761,710.83 by the end of 2021, while $100 in T-bills and T-bonds would have grown to $2,083.06 and $8,526.95, respectively.
  • T-bills produced positive returns in all 94 calendar years, while T-bonds gained in 76 of the 94 years (81%) and stocks rose in 69 (73%).

The S&P 500 clearly posts higher annualized returns, but the extreme fluctuation during market swings can make it a turbulent investment in the short-term. Bonds tend to stay fairly stable but have much lower returns overall.

Article Sources

  1. NYU Stern School of Business . "Historical Returns on Stocks, Bonds and Bills: 1928-2021."

  2. F. Reilly, G. Koa, D. Wright. "Alternative Bond Market Indexes," Page 48. Financial Analysts Journal. June 1992.

  3. J.P. Morgan Asset Management. "Guide to the Markets," Page 42.

  4. Securities and Exchange Commission. "Barclays Capital Aggregate Bond Index Portfolio," Page 2.

  5. Institute of Business and Finance. "Barclays Capital U.S. Aggregate Bond."

  6. Unversity of Arkansas. "Lehman Brothers Indices - Announcement," Page 2.